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UPDATE 1-Billionaire Patrick Drahi agrees to buy Sotheby's in $3.7 bln deal

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PARIS, June 17 (Reuters) - Patrick Drahi, the billionaire behind telecoms and media group Altice , has agreed to buy art auction house Sotheby's in a deal worth $3.7 billion on an enterprise value basis.

Sotheby's said it had signed a definitive agreement to be acquired by BidFair USA, an acquisition vehicle set up by Drahi, that had offered $57 in cash per share to buy out Sotheby's.

The offer represented a premium of 61% to Sotheby's closing price on Friday. The deal will also result in Sotheby's returning to private ownership after 31 years as a public company whose shares were traded on the New York market.

"Patrick Drahi is one of the most well-regarded entrepreneurs in the world, and on behalf of everyone at Sotheby's, I want to welcome him to the family," said Sotheby's chief executive Tad Smith in a statement.

"This acquisition will provide Sotheby’s with the opportunity to accelerate the successful program of growth initiatives of the past several years in a more flexible private environment. It positions us very well for our future and I strongly believe that the company will be in excellent hands for decades to come with Patrick as our owner," he added. (Reporting by Sudip Kar-Gupta and Nivedita Balu, editing by Deepa Babington)